Þau líta eins út.

Because Icelandic distinguishes they by gender:

• þeir = masculine plural
• þær = feminine plural
• þau = neuter plural

Þau is commonly used for a mixed group, for children, or for a group referred to neutrally. So if the people or things being talked about fall into one of those categories, þau is the natural choice.

Here líta is the present tense plural form of að líta.

A few forms are:

• ég lít = I look
• þú lítur = you look
• hann/hún/það lítur = he/she/it looks
• við lítum = we look
• þið lítið = you all look
• þeir/þær/þau líta = they look

So þau líta means they look.

Because líta út works as a verb + particle combination meaning to look / to appear.

In Icelandic, these particles are often separated from the finite verb in main clauses, so you get:

• Þau líta eins út.

rather than keeping líta út together.

So út here is not functioning like a normal standalone word meaning just out. It is part of the expression líta út.

Here eins means something like alike, the same, or in the same way.

In líta eins út, it tells you that the subjects have the same appearance.

A useful thing to remember: eins here is behaving like an adverb, so it does not change for gender, number, or case.

Yes, but it is not exactly the same idea.

• Þau líta eins út = they look alike; this is specifically about appearance
• Þau eru eins = they are alike/the same; this can sound broader and not limited to appearance

So if you want to talk specifically about how they look, líta eins út is the more precise and natural choice.

Usually, no—not if you mean look alike in the sense of appearance.

The expression you want is líta út. Without út, líta often appears in other meanings or constructions, for example:

• líta á = look at
• líta við = stop by / look in

So Þau líta eins út is the idiomatic pattern for this meaning.

It usually means they look alike or look very similar. It does not automatically mean they are perfectly identical.

So the sentence can be used for:

• twins who are hard to tell apart
• two people with very similar features
• two objects that seem the same at a glance

Context tells you how strong the similarity is.

The basic statement is:

• Þau líta eins út.

If you make it a question, the verb comes first:

• Líta þau eins út?

If you make it negative, ekki is added before the particle:

• Þau líta ekki eins út.

So út still tends to stay toward the end of the clause.

A rough guide is:

• Þ = th as in thin
• líta ≈ LEE-ta
• eins ≈ ayns
• út ≈ oot

Þau is the hardest part for English speakers. It begins with th as in thin, and the vowel sound has no exact English equivalent, though it is somewhat like the vowel in German eu/äu.

A rough overall approximation would be:

th-oy/thu-ey LEE-ta ayns oot

That is only approximate, but it is good enough as a starting point.